On August 13, 2023, about 1210 eastern daylight time, an experimental amateur-built Just Aircraft Highlander, N169SM, was substantially damaged when it was involved in an accident near Edenton, North Carolina. The private pilot and passenger were not injured. The airplane was operated as a Title 14 Code of Federal Regulations Part 91 personal flight. The pilot reported that there were 4 gallons of fuel onboard the airplane when he departed from First Flight Airport (FFA), Kill Devil Hills, North Carolina at 1130. The purpose of the flight was to fly to Dare County Regional Airport (MQI), Manteo, North Carolina, to purchase fuel. The pilot radioed his intentions to land on the common traffic advisory frequency and received a reply to radio the control tower, as MQI was a tower-controlled airport; however, a notice to airmen was in effect that the tower was not open until 1230. The pilot radioed the tower but could not hear the controller clearly and was not prepared to enter a towered airport airspace, so he diverted to Northeast Regional Airport (EDE), Edenton, North Carolina, for fuel. While en route to EDE, at 1,200 ft mean sea level over Albermarle Sound, the engine lost all power and the pilot ditched the airplane in the sound. The wreckage was recovered from the sound 3 days later. A Federal Aviation Administration inspector examined the wreckage at the shore and noted that the right elevator had separated from the airplane and was not recovered from the sound. Both wing fuel tanks were full of water. The tanks appeared intact, but water could have entered through the fuel tank vents. The carburetor and fuel bowls had about a “50/50” mixture of fuel and water remaining in them. The inspector was able to rotate the propeller and confirm continuity to the rear accessory section of the engine; however, there was some hydraulic lock due to water in the cylinders. The air filter appeared free of obstructions. The engine was examined again at a recovery facility. The top spark plugs were removed from the engine. Their electrodes were intact and light gray in color. The propeller was rotated by hand 360° to confirm crankshaft, camshaft, and valvetrain continuity to the rear accessory section of the engine. Thumb compression was verified on all four cylinders. The oil filter was opened and its screen was absent of metallic contamination. Review of fuel consumption data from the engine operator’s manual revealed that the engine consumed 7.1 gal/hr at takeoff performance, 6.6 gal/hr at maximum continuous performance, and 4.9 gal/hr at 75% continuous performance.